If you’ve been paying for the same car insurance policy for a while, it may be time to switch providers. Since car insurance is based on your personal circumstances, including your age, location, and driving history, the rates you’re eligible for will change over time. Experts recommend shopping around for car insurance periodically or whenever your circumstances change to ensure that you get the best possible deal.

While switching car insurance so often might sound intimidating, luckily there are a few simple steps to make the process as painless as possible. If you’re thinking of switching car insurance companies, you should be sure to compare policies, maintain the level of coverage you’re used to, and shop around for the lowest offers.

Why Switch Your Car Insurance?

The main reason to switch your auto insurance is that you may be able to get a lower price elsewhere. Drivers pay higher premiums if they have recent accidents in their driving history or if they’re under a certain age. In addition, premiums may be higher in certain geographical areas. If you’ve moved recently, or if it’s been a few years since the last time you got into a minor accident, you can probably secure better rates if you shop around.

It may also be necessary to change your insurance provider if you’ve moved across state lines. Not all insurance providers cover all areas of the country, so you may need to purchase a new car insurance policy if you’ve made a long-distance move. In addition, you may want to switch insurance providers depending on the level of service you’ve received.

Car Insurance Shopping Tips

Compare Companies

When shopping for new car insurance, it’s important to compare the different car insurance providers you may be considering. This can help you form a clearer picture of the services they offer and their respective prices. Be sure to get quotes from several different companies in order to compare their offers. Depending on your circumstances, you may be eligible for a variety of discounts on car insurance, including discounts for new cars, green vehicles, installing anti-theft devices, and more.

Match Current Insurance Coverage

If you’re thinking about switching providers, you should make sure that the new one matches your current coverage. This can include collision, comprehensive, and uninsured or underinsured coverage. If you’ve moved to a state with more stringent insurance requirements, or if you lease your vehicle or have a loan, you may need comprehensive and collision coverage. You should also compare the deductible between different policies.

Allow a Few Days’ Overlap

If you plan to switch auto insurance providers, it’s important not to let your coverage lapse. If you get into a car accident during the window in which you’re uninsured, you may be faced with a hefty bill for damages. Even if it might be tempting to save a few extra dollars, it’s a good idea to wait to cancel your insurance until you have a new policy already in place.

When Should You Stay With Your Current Car Insurance Company?

Some times, staying with your current car insurance company makes the most sense. If you bundle auto insurance with other packages, such as homeowners insurance or renters insurance, you may be able to secure better deals with your existing insurance provider. You may also decide that you’re happy with your current rate and the customer service that your current company provides.

How to Cancel Your Car Insurance

  • Contact your current insurer – In some cases, you may be able to cancel your insurance policy online or through your provider’s mobile app. In other situations, you may have to call the company or send a written request via email or mail. If you contact the provider by phone, make sure that you request a cancellation clearly, and ask whether or not there are any additional fees or charges associated with the cancellation process.
  • Research cancellation requirements – Cancellation requirements vary between providers. In some cases, you may need to mail written notice. There may be cancellation fees involved with switching to a new provider. Some car insurance policies require a 30-day notice before cancellation, while others charge what’s called a “short rate” fee, which is equal to 10% of the amount left on your policy period. For example, if you signed up for car insurance with a six-month contract at a rate of $200 a month and cancel four months in, you would have to pay $40 in short rate fees.
  • Contact your bank – If you’ve set up automatic payments, be sure that your bank knows that you’ve decided to switch providers. That way, the bank can stop processing any additional charges that are made by your previous insurance provider after you switch to a new one.
  • Ask for a written notice – In order to make sure that you have everything squared away, it’s a good idea to request a written notice from your insurance provider informing you that your coverage has ended. This will be proof that both you and your insurance provider are clear about the details of your cancellation, and help clear up any confusion that may arise in the future.

What’s Next?

If you’re thinking of switching car insurance providers, it’s always a good idea to shop around. Make sure to research different providers, compare rates, and look for the lowest prices on offer. If you’ve had the same car insurance provider for a while, switching companies may help you save a significant amount of money.

The best car insurance companies have comprehensive coverage, and high customer satisfaction and financial strength ratings. Before switching to a new provider, always read the fine print in order to make sure that you’re getting the best deal possible and have coverage that will protect you in the case of an accident.

About the Authors

Margaret Wack is a writer for Reviews.com. She's covered topics including personal finance, student loans, insurance, and more for publications including The Simple Dollar, PersonalLoans.org, and Interest.com.